Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

NOTE 6 - GOODWILL AND INTANGIBLE ASSETS

The Company had goodwill of $5.0 million and $5.3 million at December 31, 2014 and 2013, respectively, all of which was associated with its electronic devices reporting unit.

As of December 31, 2014, the Company assessed the qualitative factors to determine whether the existence of events or circumstances might lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. After assessing the totality of events or circumstances, including reviewing the offers received for the segment that are described in the in Note 20 below, we determined that it is not more likely than not that the fair value of the electronic devices reporting unit is less than its carrying amount. The Company performed a detailed annual impairment test for goodwill for the electronic devices reporting unit as of December 31, 2013. In performing the valuations, the Company used cash flows that reflected management’s forecasts, an assessment of the current backlog and anticipated orders and discount rates that reflect the risks associated with the current market. The Company considered the results of an income approach in determining the fair value of the reporting unit discounting the projected cash flows at the Company’s weighted average cost of capital to determine the fair value for the electronic devices reporting unit. For the income approach, growth at rates between 3% and 5% per annum was assumed as a result of expected shipments on existing contracts and future opportunities. The projected cash flows were discounted at the Company’s weighted average cost of capital of 15% to determine the fair value for the electronic devices reporting unit. Based on the results of this testing at December 31, 2013, the fair values of the electronic devices reporting unit exceeded its book values and the qualitative testing since that date indicate that there has been no diminution in the value since that date.

The following table reflects changes in the Company’s goodwill balances for continuing operations, for the year ended December 31, 2014 and 2013 (in thousands):

	Electronic Devices
Balance at December 31, 2012		5,146
Foreign currency translation		137
Balance at December 31, 2013	$	5,283
Foreign currency translation		303
Balance at December 31, 2014	$	4,980

Other intangible assets consist primarily of trademarks, trade names and technology acquired. The original cost and accumulated amortization of these intangible assets from continuing operations consisted of the following at December 31, (in thousands):

	2014									2013
	Electronic			Communications						Electronic			Communications
	Devices			Equipment			Total			Devices			Equipment			Total
Intangibles with definite lives:
Technology acquired	$	-		$	1,150		$	1,150		$	-		$	1,150		$	1,150
Customer relationships		-			200			200			-			200			200
Covenant-not-to-compete		200			-			200			200			-			200
Backlog		200			-			200			200			-			200
		400			1,350			1,750			400			1,350			1,750
Accumulated amortization		(400	)		(1,350	)		(1,750	)		(400	)		(1,282	)		(1,682	)
Carrying value		-			-			-			-			68			68
Intangibles with indefinite lives:
Trademarks and trade names		500			-			500			500			-			500
Foreign currency translation		(133	)		-			(133	)		(111	)		-			(111	)
Trademarks and trade names		367			-			367			389			-			389
Total intangible assets, net	$	367		$	-		$	367		$	389		$	68		$	457

In accordance with FASB guidance for accounting for the impairment or disposal of long-lived assets, the Company re-evaluates the carrying value of identifiable intangible and long-lived assets, except for trademarks and trade names, for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. No events or changes in circumstances occurred during 2014 or 2013 that would have required an impairment analysis to be performed. The carrying value of the trademarks and trade names is annually reviewed using a qualitative approach. The trademarks and trade names are integral to the success of the electronic devices segment. Management is satisfied that there has been no diminution in value during the year. This is supported by the offer received for the business since the year end and explained in the post balance sheet note below.